A Holistic Look At Tomson Group Limited (HKG:258)

As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Tomson Group Limited (HKG:258), it is a financially-healthy company with a a strong track record of performance, trading at a great value. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Tomson Group here.

Flawless balance sheet, undervalued and pays a dividend

258’s strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that 258 has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. 258 appears to have made good use of debt, producing operating cash levels of 2.1x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

SEHK:258 Income Statement June 18th 18
SEHK:258 Income Statement June 18th 18

258 is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of 258’s earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, 258’s share price is trading below the group’s average. This bolsters the proposition that 258’s price is currently discounted.

SEHK:258 PE PEG Gauge June 18th 18
SEHK:258 PE PEG Gauge June 18th 18

Next Steps:

For Tomson Group, I’ve compiled three important factors you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for 258’s future growth? Take a look at our free research report of analyst consensus for 258’s outlook.
  2. Dividend Income vs Capital Gains: Does 258 return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from 258 as an investment.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of 258? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!